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Advance Tax Calculator

Advance tax refers to the lump sum that an individual pays in advance in place of keeping such payments earmarked for the end of the year. Since the calculation and payment of income tax is a wearying process, it is better to pay off one's taxes earlier than delaying it for the future.

Advance tax is the tax payable on the total income earned from different revenue sources in a year. It is due to individuals who have sources of income other than their salary and is usually pertinent to income from rent, capital, profits gained from shares, fixed deposit interest, lottery winnings, etc. Advance tax can be effortlessly paid online or through certain banks. Calculation of advance tax is not a challenging process and is easy to calculate using an advance tax calculator.

What is Advance Tax?

Advance tax is the entire tax payable by a taxman before the end of the financial year from sources of revenue such as salary, commercial, profession, rent, interest, etc. This is also called "pay as you earn" scheme. You have to pay tax in case your tax obligation goes beyond Rs 10,000 in a fiscal year. The tax is required to be paid the same financial year the income was generated. Certain individuals are excused from paying advance tax. This includes senior citizens who do not own a business and taxpayers electing presumptive schemes. This applies to lawyers, doctors, architects if their annual receipts are Rs 50 Lakh maximum, or businesses who have a throughout of over 2 Crore in a financial year and have opted for presumptive schemes.

Who is required to Pay Advance Tax?

Individuals who produce a salary need not pay advance tax as their taxes are deducted at source, meaning the employer withholds tax before paying their salary. Individuals who have other sources of income besides salary are required to pay advance tax. If a salaried has a source of revenue other than their salary, then they too are required to pay advance tax. The income sources that invite advance tax include winnings from the lottery, income or rent from a property, capital gains on shares, and interest incurred from fixed deposits.

How to Pay Advance Tax?

Advance tax can be paid both online and offline. It can be paid online through National Securities Depository or the Income Tax Department. There are several options to pay the advance tax offline. You can pay tax via tax payment challans at the income tax department branches or authorized banks such as Reserve Bank of India, ICICI Bank, Syndicate Bank, HDFC Bank, Allahabad Bank, and many more.

Advance Tax Calculation for FY 2019-2020, AY 2020-2021

This is a table indicating the tax schedule for advance tax payment for self-employed and business owners:

Instalment Date Amount To Be Paid
On or before 15th September 30% of advance tax liability
On or before 15th December Minimum 60% of advance tax liability
On or before 15th March 100% advance tax liability

The due dates for payment of advance tax for FY 2019-2020, AY 2020-2021 are as follows:

Due Date Amount Payable
On or before 15th June 15% of total advance tax liability
On or before 15th September 45% of total advance tax liability
On or before 15th December 75% of total advance tax liability
On or before 15th March Total advance tax as to be paid (100%)

For the late payment of advance tax, an individual has to pay interest. The interest is calculated as 1% of the evaded sum every month until the tax is paid off totally. The same interest is pertinent if an individual forgets to pay the advance tax by the required deadline.

How to Calculate Advance Tax using Advance Tax Calculator

Anyone can evaluate his or her tax on their own to determine if they have pay the advance tax using an advance tax calculator. There are a few steps to follow when using and calculating advance tax. 

  • Collect all your sources of income 
  • Subtract all expenses from your income
  • Total all your sources of income, including interest, income from rent, etc.
  • If the tax due is over Rs 10,000, then you have to pay advance tax

Let's take an example of a person who has a total tax amount to be paid of Rs.95000 after calculating his income, deducting expenses from interest on fixed deposit and income earned from rent beside his salary. The advance tax calculator below would provide an accurate depiction of the advance tax that is liable to be paid.

A sample table is provided for reference:

Due Date Advance Tax Due Advance tax to be paid to avoid interest Tax paid till date Shortfall Interest payable @ 1% per month
15th June 14250 (15%*95000) 11400 (95000*12%) 12000 2250 No interest as amount is more than 12%
15th September 42750 (45%*95000) 34200 (95000*36%) 10750 10750 322.5
15th December 71250 (75%*95000) 71250 (95000*75%) 12250 12250 367.5
15th March 95000 (100%) 95000 (100%) 11000 11000 110
Total interest under section 234C 800

Here is a more in-depth advance tax calculator to help you calculate the tax payable in advance:

For a person below 60 years of age who is a resident of India, the first instalment of advance tax to be paid is on 15th June, which is 15% of the total advance tax liable.

  • Enter particulars of taxable income at regular rates
1. Approximate Income from Salary/Annuity ( Net of Standard Deduction ) 60,000
2. Approximate Income from Business / Profession 3,00,000
3. Approximate Income from Housing Property ( If it is a loss, then enter minus sign " - " before amount ) 2,00,000
4. Approximate Income from Capital Gains (Taxable at regular Rate) 90,000
5.Approximate Income from Other avenues (Taxable at regular rate) 60,000
6. Total Income Taxable at Regular  Rates 7,10,000
  • Enter particulars of 'Income taxable at Specific Rates'
1. Approximate taxable income at 10%  
2. Approximate taxable income at 15%  
3. Approximate taxable income at 20%  
4. Approximate taxable income at 30%  
5. Total Approximate taxable income at Specific Rates  
  • Enter particulars of applicable deductions from taxable income
1. Under sections 80C, 80CCC & 80CCD(1) ( Maximum 1.50 Lakh) 1,50,000
2. Under section 80CCD(2) ( Maximum 10% of salary ) 3,500
3. Under section 80CCG ( Maximum Rs 25,000 ). 25,000
4. Under Section 80D for self/family. Maximum Rs 50,000 for citizens above 60 years and maximum Rs 25,000 for any others.  
5. Under section 80D ( parents ) ( Maximum Rs. 50,000 if parents are above 60 years of age otherwise Rs 25,000 for the rest)  
6. under section 80TTA ( Maximum ₹ 10,000/- )  
8. Any other eligible deduction  
9. Total deductions from Taxable income 1,78,500
  • Enter particulars of the approximate amount of tax deducted / Collected / Paid for the year
1. Approximate amount of tax deducted at source utilized for the year  
2. Approximate amount of tax deducted at source utilized for the year  
3. Advance Tax paid  
  • Taxable Income and Tax Liability
1. Taxable Income at Regular Rates 5,31,500
2. Taxable Income at Specific Rate  
3. Total Income which is Taxable ( E1 + E2 ) 5,31,500
4. Income Tax at Regular Rates 18,800
5. Income Tax at Specific Rates  
6. Relief under Section 87A  
7. Total Income Tax to be paid (E4 + E5 – relief under section 87A ) 18,800
8. Surcharge
(at standard rates)
 
9. Marginal Relief in Overcharge ( If E3 marginally exceeds ₹ 50 lac / 1 Cr. / 2 Cr. / 5Cr. )  
10. Total Surcharge ( E7 - E8 )  
11. Income Tax + Total Surcharge ( E6 + E9 ) 18,800
12. Total Health & Education Cess ( 4% of E10 ) 752
13. Total Tax to be paid ( E10 + E11 ) 19,552
14. Income Net of Income Tax Liability ( A6 + B5 - E13 ) 6,90,448
  • Advance tax to be paid
1. Due for payment on or before 15th June 2019 [ 15% of (E13 - D1) ] 2,933
2. To be paid on or before 15th June 2019 ( F1 - D2 ) 2,933

In case you would like to take assistance instead of an advance tax calculator, opting for a Chartered Accountant is an excellent way to go. A CA can ensure that your calculations are accurate and will assist you through a smooth, hassle-free process.

Advantages of Advance Tax Payment

You can now easily calculate the required advance tax to be paid using an advance tax calculator. Let's take a look at the several benefits of paying advance tax:

  • It reduces the taxpayer's stress at the end of the financial year. Paying in instalments can ensure a lesser burden.
  • It helps the government by accelerating the tax payment process
  • Prevents tax defaulting
  • Increases funds for the government
  • Helps to manage their finances comfortably

Over to you!

Using an advance tax calculator to figure out how much advance tax is liable is quite easy to do. Always get your figure checked out by an accountant before submitting your taxes. If the Income-tax department calculates your taxes and sees that excess tax has been paid, then you can easily claim a refund as well. Now that you have full knowledge about advance taxes and how to calculate it, you can go ahead and plan your financial year with ease.

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Written By: Paisawiki - Updated: 12 April 2021